Startups Making Do with Fewer Workers, Kauffman Study Shows
Has the air gone out of the American economy? That’s the troubling suggestion of a new study showing how, even before the current downturn, fewer new firms were being formed and those that did open for business were hiring fewer workers.
Titled “Starting Smaller, Staying Smaller: America’s Slow Leak in Job Creation,” the report looks at the entire gamut of new companies and not just high-tech startups.
But Dane Stangler, research director for the Kauffman Foundation of Kansas City, MO, which produced the study, says technology firms exemplify these hiring practices because they are most familiar with the productivity tools that let employers get more work done with lower headcounts.
“Clearly technology is at play because you need fewer people to run a company nowadays,” Stangler says. “And one of the most prominent places you see that is in the tech sector.”
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